Friday, September 4, 2009

US Logistics Giant Hit by Profit Slump

Things set to improve says UTi CEO
Shipping News Feature

CALIFORNIA – UTi Worldwide the Long Beach based logistics and forwarding company reported a two thirds drop in net profit for the three months to the end of July 2009. Turnover was down by a third to just above $840 million but the nett profit figure fell from circa $34 million to under $12 million.

Despite these seemingly gloomy figures Eric W Kirchner, UTi’s CEO since January, remained upbeat. "The environment appears to be more stable than we have seen in some time, albeit at levels that are lower than the prior year," he said in a statement.

"While I am not satisfied with the quarter's results, we are on track with our sales initiatives and transformation efforts, and they are expected to drive improvement in the future. Results in the quarter continued to be impacted by weak economic and industry conditions. But the pace of volume declines moderated throughout the quarter, primarily due to seasonal factors."

Mr Kirchner also claimed the company has continued to gain “significant” new business including what is expected to be the largest forwarding contract in the company’s history.

In common with other industry giants UTi have lowered their operating costs by cutting overheads in addition to the reduction of expenses which occur naturally with the decrease in tonnage and number of freight movements.